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Research: Is it possible for students to get auto loans with no credit history? -

Getting a car as a student can never be an easy thing to do. You need to take into consideration the fact that you will have to finance yourself for it and make the monthly payments on time. If your dad is helping, it is always a great thing but if not you need to put some thought into investing in it.

Firstly, you need to figure out if you need it. If you live far away from college or school, it makes sense to invest in a car. It is also better to do it in a group. This way you can car pool to school and share the costs associated with maintaining it. It is really not possible to bicycle if you live far away from school. And it can get tough during the winter months. A car can save a lot of time, which you can use for your course work or for part time jobs.

The main obstacle to owning a car is that you cannot easily get a loan approved as a student. You will either need someone to co-sign on the loan or you will need to settle for exceptionally high interest rates as you have no credit history. Now more often than not, a student will not have a credit history given the fact that he or she would have just opened a bank account after getting out of high school.

There are a lot of banks that offer instant approval loans. Lenders are aware that students do not have loads of cash lying around to be able to afford down payments on the car. Now an auto loan is usually easy to get since it is automatically secured. It`s all about reaching the minimum eligibility criteria that the lender sets for the borrower.

There are also several low interest rate schemes. For students, they might also look into college records like grades to make an appraisal about the credit worthiness of the individual. There will also be flexible repayment schemes based on the type of lender that you decide to go with.

Now down payments are something that would be a huge burden if you do not have anybody to help you out with it. The best way to get a very low interest rate loan would be to put in a substantial down payment. But if you cannot do this, most lenders will accept even ten percent of the cars value as down payment.

The co-signer is not compulsory. It all boils down to which lender you decide to go with. Choosing the right lender will go a long way in reducing your burden. Go online and look for quotes. You can fill in your details and get instant quotes and get a feel of the sort of investment you are going to have to make before meeting the agents in person. Remember, buying a car is mostly the first big financial step that you are taking. Use it as a means to gain experience with the least possible financial impact.